- Why Insights?
- Get in Touch
October 11, 2018
The self-storage industry is booming in the United States, which is excellent for self-storage owners and managers. However, with great opportunity comes great competition.
As you look around at your primary market area, you may begin to wonder: Should I be offering discounts and specials?
The answer is this: it depends.
Before you add discounts and promotions to your self storage marketing plan, evaluate your occupancy, the phase your business is currently in, the condition of your facility and other factors. Here’s a look at four important things to account for when considering discounts and specials.
Renting a discounted unit is always better than leaving a unit empty. However, don’t become so consumed with achieving 100% occupancy that you offer too many specials or too deep of discounts.
A good rule of thumb is to set a strategic threshold at which you’ll start offering discounts. For example, if you have 100 storage units, consider offering the first month free (with the second month paid up front) if and only if you have 8 or more units available. Then, if you have 4–7 units available, offer half off the first month (with the second month paid up front).
If your website provider is capable of it, these discounts and promotions can be offered directly on your self storage marketing website.
Here’s the thing: If you’re at least 90% occupied, there’s no need to panic and offer self storage specials or discounts. Your facility is 90% full for a reason, and it’s likely you can draw closer to 100% with customers paying full price.
Perhaps the best time to offer discounts and specials is when you first open and need to fill up as quickly as possible. You’re always operating in the red when you first start, so get those units filled as quickly as possible, and then retain those customers as they transition to full price.
How should you construct specials and discounts? Start by keeping them both short and simple.
Keep them short by frontloading discounts for the first month only. Then, after just 30 days, your discounted customer because a customer paying in full. If you stretch discounts out over two months or longer, you’re gutting your revenue over a longer stretch — which makes it hard to run a viable business.
Keep them simple by ensuring a discount or special’s benefit is clear and attractive to your target audience. If you offer the first month’s rent at just $1, that’s a discount anyone can quickly understand and appreciate. If you create a special that includes random, off-the-wall, hard-to-decipher benefits, they aren't as attractive to customers, and you’ll find that occupancy doesn’t budge.
This is an overlooked aspect of specials and discounts: Make sure your units are worth renting in the first place.
Sometimes the hard truth is that your self-storage facility is in poor shape and need capital improvements. Occupancy is lagging because of the need for updates — not due to a lack of specials and discounts.
So, instead of losing money by offering substantial discounts, put that money toward improving your facility. A fresh coat of paint can go a long way toward improving the look and feel of your facility, and just a few minor security upgrades can serve as a differentiator for your business.
If you invest in making your facility an attractive and obvious option for your target audience, you may find that you don’t need discounts and specials at all.
If your facility is already in exceptional shape, a powerful self storage marketing campaign can help inform potential tenants.
Some of your prospective customers are always shopping for the lowest price. For that reason, do a little market research from time to time, and make sure you’re staying competitive price-wise with comparable facilities in the area.
Watch for any discounts or specials that the competition might be offering. Check the competition’s website for coupons. You can even call prospective customers that didn’t choose your facility and ask them politely: Can you share why you picked someone else?
That kind of research and investigation can pay huge dividends as you set your prices and as you create discounts and specials to keep pace with the competition.
What type of discount or special will work best for your storage facility? Think about your core customer base and what would most appeal to them. Then try to craft a special or discount around a traditional structure, such as:
Ask your existing customers to refer more customers, and then give them a free month or 50% off a month when a referral comes through.
As noted above, offer the first month free or the first month for just $1 if you have enough availability.
Consider giving a small price break for veterans, military personnel, emergency response workers, teachers, students, seniors, etc.
Think about what your target audience needs most, and then offer it as a giveaway when a new contract is signed. It could be a lock, boxes, the use of a dolly or something similar.
Run an old-school coupon to reach a different audience — the coupon can be the same deal as your promotional discount.
There are so many different ways to deliver discounts and specials. Choose the deliver method that works best for your facility and its target audience, and watch as your occupancy steadily increases.
One great way to boost your facility’s occupancy is through highly effective digital marketing. At Storage Pug, we offer a wide range of digital marketing services exclusively for self-storage businesses, including Self Storage SEO, pay-per-click ads, web design, online rentals and more.
Get in touch today for a free demo.
If you enjoyed this article, here are some others you might like: